"You won a free ticket to see an Eric Clapton concert (which has no resale value). Bob Dylan is performing on the same night and is your next-best alternative activity. Tickets to see Dylan cost $40. On any given day, you would be willing to pay up to $50 to see Dylan. Assume there are no other costs of seeing either performer. Based on this information, what is the opportunity cost of seeing Eric?"

I had a nice lunch at Tip y Tap in Santiago with John Londregan, in early July, where John made much the same argument.

But there is more to the argument. This is not just a mistake, but a bias. Dem activists are convinced (quite wrongly) that if someone would just come out and SPEAK THE TRUTH, that voters would flock to them. So the failure to speak the truth (capitalism is evil, government should control everything) is only a sign of weakness. Since they only talk to each other, these activists suffer from the "Polled my friends, and we all agree" fallacy.

So it is not just the attribution of good tactics to successful campaigns that is going on, but the belief by activists that the reason Obama is doing poorly is that he is trying to court the center.

Now, the same (mutatis mutandis) is at least as true, and maybe moreso, for Republican activists, I admit. And for Libertarians? It isn't a problem, because we don't have any friends, and don't believe in polls.

At the US Open, Novak Djokovic compared having shade on the tennis court to sleeping with his girlfriend!

Really. See your yourself:

People, I live in Oklahoma where it's been at or around 100 for a month and a half now. Believe me, us Okies appreciate shade as much as anybody. But I've never heard anyone make a comparison remotely like that.

Of course, this leads to several intriguing possibilities. Perhaps Novak's lady friend is just not very sexy? Or maybe Novak is DOING IT WRONG?

Let's just say it's something that Pablo Picasso was never called (at least not in New York):

Raymond E. Stauffer was shopping at a New Jersey mall when he noticed something peculiar about the bow ties on display at Brooks Brothers: They were labeled with old patent numbers.

Mr. Stauffer, who calls himself a "sharp-dressed man," also happens to be a patent lawyer. He sued Brooks Brothers Inc. in federal court, claiming it broke the law by marking its adjustable bow ties with patents that expired in the 1950s.

And of course we are off to the races:

Marking a tube of toothpaste or paper cup with a patent that is out of date or doesn't exist has been against the law for years. It is considered anticompetitive. Until late last year, the most a violator had to worry about was paying a $500 penalty for misleading the public.

But in December, the Court of Appeals for the Federal Circuit in Washington ruled that defendants could be held responsible for up to $500 per offense.

Lawyers for product manufacturers now fear clients are liable for up to $500 for every tube of mascara or box of garbage bags marked with an expired patent—an error that turns out to be quite common.

In recent months, would-be plaintiffs have been fanning out across retail stores and the Internet searching for expired patent numbers on everything from toothpaste to toilet plungers.

I have to admit that to me the most baffling part of this story is that there once were patents on bow ties and toilet plungers!

The University of Texas at Austin--The Charles N. Wilson Chair in Pakistani Studies

The Department of Government invites applications from distinguished senior scholars for appointment to the Charles N. Wilson Chair in Pakistani Studies. This is the first privately endowed chair of its kind at a US public university and honors the late Congressman from Texas. The successful candidate will hold a tenured position in the Department of Government and is expected to carry out research directed at understanding the geo-political importance of Pakistan, provide intellectual leadership on campus promoting the study of Pakistan’s culture, history, and literature, teach effectively at the undergraduate and graduate levels, and perform service for the department, the College of Liberal Arts, and the University. Applicants must have a PhD in hand at the time of appointment. Candidates must demonstrate a record of excellence and agenda for research contributions to the field of Pakistani Studies and teaching at the college level. Position funding is pending budgetary approval.

Interested parties should send a letter of application and vitae to: Professor Gary Freeman, Chair, Department of Government, The University of Texas at Austin, 1 University Station A1800, Austin, TX 78712-0119. The priority deadline is October 1, however applications will be accepted until the position has been filled. A background check will be conducted for successful applicants. AA/EEO employer.

Gary P. FreemanProfessor and Chair of GovernmentUniversity of Texas at Austin

Nathan Kocherlakota certainly created a blogstastic firestorm with his statement that we need to raise interest rates to avoid deflation (Here is a good round up from Economist's View).

In a strange way, I think this can be related to Scott Sumner's multi-year hammering of the argument that money is indeed too tight.

Sumner favors the Fed targeting nominal GDP; it is not clear to me what Kocherlakota favors targeting.

If the Fed directly targeted a 5% inflation rate and did so successfully, two things would happen. First, we would avoid deflation. Second, interest rates would rise.

If the Fed directly targeted an 8% nominal GDP growth rate, the same two things would happen.

So, I can read Kocherlakota as making sense by interpreting him as calling for the Fed to change its operating procedures, something that he does not directly do in his statement.

The thing to remember is that the Fed has conditioned most people and most macro economists to believe that the setting of the Fed funds rate IS monetary policy. Thus, if the funds rate were zero, then monetary policy could not really be any looser. From that viewpoint, Kocherlakota's statement is, to say the least, counter-intuitive. Raising interest rates is by definition a tightening of policy.

But things don't have to be this way.

Raising an inflation target would be by definition a loosening of policy and would cause interest rates to rise.

People, the theoretical and intellectual foundations for having monetary policy be a Fed funds target set by some kind of secret type of Taylor rule are weak in general and super weak in our present circumstance.

I still strongly reject the plausibility of the "lets raise inflation to lower the real interest rate" meme that sometimes floats around (yes I'm talkin' to you LeBron), but could totally get on board the "let's target an inflation rate of 4-5% to avoid deflation" train.

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These spammers today, I tell you. How lazy can you get? No Nigerian colonels, no secret lottery, nothing. And this bozo is from New Zealand. They speak English there (sort of). "$8.4 million Dollar's"?

Only in Japan could a zenophobic hate group be named "Citzen's Group That Will Not Forgive Special Privileges for Koreans in Japan".

Their actions aren't as obtuse as their name though:

The demonstrators appeared one day in December, just as children at an elementary school for ethnic Koreans were cleaning up for lunch. The group of about a dozen Japanese men gathered in front of the school gate, using bullhorns to call the students cockroaches and Korean spies.

Their reason?

Well their leader "defended the protests at the Korean school in Kyoto as justified to oppose the school’s use of a nearby public park, which he said rightfully belonged to Japanese children."